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Muni In Muscatine: Upgrades, Speeds Up, Outperforms

Cedar Falls may be the Iowa city famous for its Fiber-to-the-Home (FTTH) network, but that won’t stop Muscatine. This small city of approximately 29,000 people is about to upgrade its aging network. For a little over a year, the municipal utility, Muscatine Power and Water (MP&W), has planned for the move to FTTH with funding from an interdepartmental loan. Now, FTTH is coming to Muscatine's MachLink Internet access service.

MP&W expects to break ground this year on this $8.7 million FTTH project and to finish building the network in 2017. Fiber will offer speeds much faster than those available on the existing hybrid fiber-coax (HFC) network. In anticipation, MP&W is increasing speeds for subcribers without raising rates.

More than a Year in the Making

The local newspaper, the Muscatine Journal, has closely followed the story. In late November 2014, MP&W announced the planned FTTH upgrade. MP&W is taking a slow and steady approach and planning to complete the upgrade in 2017. The latest Muscatine Journal article from this March emphasized how the large infrastructure project has many "interlocking" pieces that must fit together to make the project successful.

As we reported when MP&W announced the upgrade in 2014, a FTTH network will achieve immediate goals and help achieve a number of benefits. MP&W wants to improve residential services, reduce maintenance costs, and increase network reliability. Upgrading to FTTH will also contribute to long-term goals, such as encouraging economic development. Fiber is a future-proof technology, adapting to the increasing need for bandwidth from households, businesses, and institutions. MachLink will offer speeds of up to a Gigabit (1,000 Megabits) per second.

Outperforming Expectations

In the spirit of community, MP&W is increasing speeds without raising rates. MP&W announced that current customers will get twice the speed for no additional charge. Current MachLink subscribers with the fastest tier receive 100 Megabits per second (Mbps) download which will double, but Gigabit speeds will dwarf even that. Upload speeds have yet to be determined.

It’s a good move as the TV and Internet services in Muscatine are continuing to grow in popularity. The communications division has outperformed already high expectations according to the Muscatine Journal this January:

“A profit of $1.25 million was budgeted for the Communications Utility for 2015, but actual profit was $1.79 million. For December, actual profit of $214,638 outperformed the budgeted $120,136.”

Without this public network, those dollars could have all gone to absentee-owned providers - who wouldn’t be investing money to improve the network. Also, it’s important to note that publicly owned networks do not actually make a “profit” to be distributed among shareholders, but rather extra revenue is reinvested in other community projects, used to improve the network, to pay down debt, or put in a rainy day fund. Publicly owned network "shareholders" are people who live and work in the community served by the network.

The FTTH network will make current services even better. As Beecher Sykes, MP&W manager of telecommunications, told the Muscatine Journal in March,

“(Fiber is) an extreme benefit not only to customers but the community as a whole.”

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In terms of fiber-enabled cost savings, 120 businesses in Bristol reported an average of $2,951 in savings per year, while, in Reedsburg, 33 cited annual cost savings averaging $20,682. Twenty Jackson businesses reported cost impacts due to fiber, with one large organization reporting a total of $3 million in savings. The other 19 Jackson respondents reported a net average cost increase of $3,150 per organization.